Musk’s lawyer challenges Altman’s credibility as OpenAI trial nears end

By Kenrick Cai, Deepa Seetharaman and Jonathan Stempel

OAKLAND, California, May 14 (Reuters) – A lawyer for Elon Musk hammered at the credibility of OpenAI CEO Sam Altman on Thursday, near the end of a trial at which Musk wants jurors to hold the ChatGPT maker and its leaders responsible for transforming the nonprofit into a vehicle to enrich themselves.

Musk is suing OpenAI and Altman for breach of charitable trust and unjust enrichment, accusing them of “stealing a charity” by straying from OpenAI’s founding mission to build safe artificial intelligence to benefit humanity.

The world’s richest person said the OpenAI defendants manipulated him into giving $38 million, only to go behind his back by attaching a for-profit business to its original nonprofit, and accepting tens of billions of dollars from Microsoft and other investors to grow.

OpenAI has said the organization is stronger as a for-profit entity, including the nonprofit that is now a shareholder of the corporation, and that Musk simply wanted control.

MUSK WANTED OPENAI NONPROFIT, LAWYER SAYS

In his closing argument in the Oakland, California, federal court, Musk’s lawyer Steven Molo said five witnesses, including Musk, former OpenAI board members and OpenAI’s former chief scientist testified that Altman was a liar.

He noted that when Altman was asked during cross-examination on Tuesday whether he was completely trustworthy and did not mislead people in business, Altman did not say yes unequivocally.

“Sam Altman’s credibility is directly at issue in this case,” Molo said. “If you don’t believe him, they cannot win.”

Molo said Musk, in contrast, was committed to ensuring his money would not benefit individual people.

“Elon wanted OpenAI to remain essentially a philanthropic endeavor,” Molo said. “He did not want to shut down the nonprofit.”

He accused the OpenAI defendants of breaching the charitable trust Musk created by enriching investors and insiders at the nonprofit’s expense, and failing to prioritize AI safety, open-source technology, and follow nonprofit governance practices.

Defense lawyers will give their closing arguments later on Thursday.

Musk is seeking about $150 billion in damages from OpenAI and Microsoft, which would be paid to OpenAI’s nonprofit to further its altruistic goals. He also wants Altman and OpenAI President Greg Brockman removed from their roles. Microsoft has spent more than $100 billion on its partnership with OpenAI, a Microsoft executive testified.

OpenAI competes with AI companies such as Anthropic and Musk’s smaller xAI, and is preparing for a possible initial public offering that could value the business at $1 trillion.

Musk’s xAI is now part of his space and rocket company SpaceX, which is also preparing a potential blockbuster IPO.

LAWYERS TO ARGUE REMEDIES WHILE JURORS DELIBERATE

U.S. District Judge Yvonne Gonzalez Rogers is overseeing the case.

It is unclear when the nine-person jury will begin deliberations.

If there is no verdict before Monday, the judge and lawyers will return to court that day to discuss how OpenAI should be restructured and what damages should be paid if Musk wins.

Gonzalez Rogers will determine remedies and will award none if Musk loses.

The trial comes amid significant public concerns over AI as it penetrates society.

People use AI for myriad purposes such as facial recognition, financial advice, journalism, medical diagnoses, and harmful deep-fakes. Many people express distrust of the technology and worry it could displace people from their jobs.

MUSK’S AND ALTMAN’S SINCERITY WAS CHALLENGED

OpenAI was founded by Altman, Musk and several others in 2015, though Musk left its board in 2018.

The sincerity of Altman and Musk about their attitudes toward OpenAI and goals for the AI business has been a central issue in the trial, and neither man has emerged unscathed.

OpenAI has tried to show that even Musk supported its creation of a for-profit business to raise money for computing power and fend off rivals such as Google.

It has also said Musk demanded unilateral control to ensure his continued support. Musk’s effort last year to buy OpenAI through an xAI-led consortium has also been a point of dispute, with OpenAI trying to show it was inconsistent with Musk’s goals in his lawsuit.

Musk’s lawyers have tried to portray Altman and Brockman as interested in riches for themselves.

They elicited testimony that Altman had a more than $2 billion stake in companies that did business with OpenAI, and Brockman’s statement that his own OpenAI stake was worth nearly $30 billion.

There was also testimony about Altman’s 2023 ouster by OpenAI’s board, which also challenged his candor. Altman was reinstated in less than one week.

Former OpenAI Chief Scientist Ilya Sutskever testified to having gathered evidence to show Altman’s “consistent pattern of lying.”

Musk’s lawyer also questioned whether Altman had conflicts of interest through his involvement in companies that worked with OpenAI.

Altman said he has no direct equity stake in OpenAI, though he has a stake in a fund invested in the company.

(Reporting by Kenrick Cai and Deepa Seetharaman in Oakland, California, Jonathan Stempel in New York and Juby Babu in Bengaluru; Editing by Rod Nickel)